Key Points -
On October 6, 2021, the DOJ announced two new initiatives: the Civil Cyber-Fraud Initiative and the National Cryptocurrency Enforcement Team.
The Civil Cyber-Fraud Initiative will fight rising cyber threats...more
10/13/2021
/ Cryptocurrency ,
Cyber Incident Reporting ,
Cybersecurity ,
Cybersecurity Maturity Model Certification (CMMC) ,
Department of Defense (DOD) ,
Department of Justice (DOJ) ,
DFARS ,
False Claims Act (FCA) ,
Federal Acquisition Regulations (FAR) ,
Homeland Security Cybersecurity & Infrastructure Security Agency (CISA) ,
NDAA ,
Popular ,
Supply Chain
Key Points -
The SEC has charged App Annie, Inc. and its former CEO with violations of Section 10(b) of the Exchange Act and Rule 10b-5, which constitute the primary mechanism for enforcing insider trading violations.
This...more
Last week, the U.S. Securities and Exchange Commission filed a complaint in federal court in California premised on the novel legal theory that the insider trading laws apply where an insider uses confidential information...more
8/25/2021
/ Acquisitions ,
Confidential Information ,
Enforcement Actions ,
Insider Trading ,
Material Nonpublic Information ,
Misappropriation ,
Private Funds ,
Rule 10b-5 ,
Scienter ,
Securities and Exchange Commission (SEC) ,
Securities Fraud
Key Points -
The SEC and the FCA each publish annual reports on their enforcement actions.
Whilst enforcement data only shows a snapshot of the regulators’ activities, there is much to be learned from these reports,...more
Amendments Come on the Heels of Supreme Court Decisions on SEC Disgorgement -
On January 1, 2021, Congress passed the National Defense Authorization Act (NDAA). Embedded in the NDAA’s more than 1,400 pages is Section...more
- The OCIE of the SEC highlights that responses to COVID-19 present important regulatory and compliance issues for SEC registrants, including “heightened risks of misconduct” tied to recent market volatility.
- The Risk...more
8/21/2020
/ Asset Management ,
Broker-Dealer ,
Business Continuity Plans ,
Business Operations ,
Compliance ,
Conflicts of Interest ,
Coronavirus/COVID-19 ,
Cybersecurity ,
Data Protection ,
Fees ,
Financial Transactions ,
Investment Adviser ,
Investment Fraud ,
Investment Management ,
Investors ,
OCIE ,
Personally Identifiable Information ,
Policies and Procedures ,
Popular ,
Remote Working ,
Risk Alert ,
Securities and Exchange Commission (SEC) ,
Supervision
- In the age of broad corporate teleworking brought on by COVID-19, OCIE of the SEC has observed during recent examinations that investment advisers, broker-dealers and investment companies are subject to an increased threat...more
7/16/2020
/ Broker-Dealer ,
Cyber Attacks ,
Cybersecurity ,
Data Breach ,
Financial Services Industry ,
Homeland Security Cybersecurity & Infrastructure Security Agency (CISA) ,
Incident Response Plans ,
Investment Management ,
Malware ,
OCIE ,
Popular ,
Ransomware ,
Risk Alert ,
Securities and Exchange Commission (SEC)
- On June 23, 2020, the SEC and OCIE issued its latest Risk Alert describing common deficiencies it has observed in recent examinations of registered investment advisers that manage private equity funds or hedge funds.
-...more
7/6/2020
/ Conflicts of Interest ,
Enforcement Actions ,
Fees ,
Hedge Funds ,
Investment Management ,
Non-Public Information ,
OCIE ,
Policies and Procedures ,
Private Equity Funds ,
Registered Investment Advisors ,
Risk Alert ,
Securities and Exchange Commission (SEC)
- In Liu v. SEC, No. 18-1501, the Supreme Court upheld the SEC’s ability to obtain disgorgement as a form of equitable relief in civil actions in federal court, pursuant to 15 U.S.C. § 78u(d)(5).
- However, the Court...more
6/30/2020
/ 15 U.S.C. § 78u(d)(5) ,
Administrative Authority ,
Business Expenses ,
Calculation of Damages ,
Corporate Misconduct ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Net Profits ,
Remedies ,
SCOTUS ,
Securities and Exchange Commission (SEC)
- DOJ’s update offers additional insights into its approach to evaluating corporate compliance programs.
- The update places emphasis on compliance programs that are continuously improving, data driven and supported with...more
6/12/2020
/ Acquisitions ,
Chief Compliance Officers ,
Compliance ,
Corporate Governance ,
Corporate Misconduct ,
Department of Justice (DOJ) ,
Due Diligence ,
Mergers ,
Policies and Procedures ,
Risk Assessment ,
Risk Management ,
Third-Party Risk
- The Supreme Court has unanimously reversed the convictions of the state officials in the “Bridgegate” scandal.
- This decision will have broader implications beyond the context of political corruption and will also...more
5/15/2020
/ Appeals ,
Bridgegate ,
Criminal Convictions ,
Federal-Program Fraud ,
Governor Christie ,
Intent to Obtain Money or Property ,
Kelly v United States ,
Political Scandals ,
Public Officials ,
Reversal ,
SCOTUS ,
Wire Fraud
- The COVID-19 crisis creates heightened risk of improper financial reporting.
- Audit committees can and should take steps to help prevent such frauds.
- Audit Committees should maintain the appropriate tone at the...more
- Market participants should review and assess their compliance procedures to prevent and detect insider trading risks associated with COVID-19.
- Companies should increase their vigilance regarding cybersecurity threats...more
4/1/2020
/ CFTC ,
Coronavirus/COVID-19 ,
Cybersecurity ,
Department of Justice (DOJ) ,
Enforcement Actions ,
Financial Crimes ,
Insider Trading ,
Investors ,
Phishing Scams ,
Pump and Dump ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
U.S. Treasury ,
Wire Fraud
Key Points:
The 2nd Circuit has issued a landmark decision for insider trading enforcement that will make it significantly easier for the government to prosecute insider trading in criminal cases.
The decision may also...more
• The Supreme Court will review whether the SEC has the authority to obtain disgorgement in actions to enforce the federal securities laws.
• Since the Supreme Court’s decision in Kokesh v. SEC, 137 S. Ct. 1635 (2017),...more
11/12/2019
/ Administrative Authority ,
Certiorari ,
Disgorgement ,
Enforcement Actions ,
Equitable Relief ,
Kokesh v SEC ,
Lack of Authority ,
Liu v Securities and Exchange Commission ,
Penalties ,
Petition for Writ of Certiorari ,
Regulatory Agencies ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Split of Authority ,
Statute of Limitations
• The CFTC has filed a new “insider trading” enforcement action involving the energy markets—the agency’s third energy market insider trading case since 2015.
• The CFTC also created an Insider Trading and Information...more
10/3/2018
/ Anti-Fraud Provisions ,
Asset Management ,
Breach of Duty ,
CFTC ,
Commodities ,
Confidential Information ,
Electricity ,
Energy Market ,
Energy Sector ,
Enforcement Actions ,
FERC ,
Insider Trading ,
Market Manipulation ,
Natural Gas ,
Oil & Gas ,
Risk Mitigation ,
Securities Fraud
• SEC ALJs are “Officers of the United States” within the meaning of the Appointments Clause and therefore must be appointed directly by the SEC. The Court’s decision may permit litigants in prior and pending administrative...more
6/26/2018
/ Administrative Agencies ,
Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Appeals ,
Appointments Clause ,
Constitutional Challenges ,
Enforcement Actions ,
Final Written Decisions ,
Lucia v SEC ,
Officers of the United States ,
Remand ,
Reversal ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Special Trial Judges (STJs)
• A New York federal judge held that virtual currencies are commodities within the meaning of the Commodity Exchange Act.
• This marks the first court decision to assess and to adopt the CFTC’s position that virtual...more
3/14/2018
/ CFTC ,
Commodities ,
Commodity Exchange Act (CEA) ,
Consumer Protection Act ,
Cryptocurrency ,
Currency Manipulation ,
Enforcement Actions ,
Fraud ,
Jurisdiction ,
Preliminary Injunctions ,
Securities and Exchange Commission (SEC) ,
Virtual Currency
In an important decision given on February 21, 2018, a jury in English court proceedings has considered for the first time what “adequate procedures” should be for the purpose of a defense to the corporate offense of failing...more
3/13/2018
/ Anti-Bribery ,
Bribery ,
Corporate Counsel ,
Corporate Liability ,
Criminal Convictions ,
Criminal Liability ,
Criminal Prosecution ,
Deferred Prosecution Agreements ,
Jury Verdicts ,
National Crime Agency (NCA) ,
Policies and Procedures ,
Section 7 ,
Self-Reporting ,
UK ,
UK Bribery Act
• The voluntary disclosure of a Foreign Corrupt Practices Act (FCPA) violation, “full cooperation” in an ensuing investigation, and timely and appropriate remediation, will create a presumption that the disclosing company...more
12/4/2017
/ Anti-Corruption ,
Attorney General ,
Cooperation ,
Corporate Fines ,
Department of Justice (DOJ) ,
Disgorgement ,
Federal Pilot Programs ,
Foreign Corrupt Practices Act (FCPA) ,
Forfeiture ,
Memorandum of Guidance ,
Remediation ,
Restitution ,
Self-Reporting ,
Substantial Aggravating Circumstances ,
Voluntary Disclosure
• A divided 2nd Circuit holds that there is no requirement for a “meaningfully close personal relationship” between a tipper and tippee in order for the tipper to reap a personal benefit from the disclosure sufficient to give...more
On December 6, 2016, in an opinion written by Justice Alito, the Supreme Court unanimously affirmed the Ninth Circuit’s decision in Salman v. United States, a closely-watched insider trading tipping case. Salman builds upon...more
On November 16, 2015, the U.S. Department of Justice revised the United States Attorneys’ Manual (USAM) to align the principles by which federal government prosecutors investigate and prosecute criminal cases involving...more
On September 9, 2015, the U.S. Department of Justice issued guidance regarding the prosecution of individuals in cases involving criminal and civil corporate wrongdoing. The first major policy memorandum issued since Attorney...more
In recent years, taking advantage of expanded jurisdictional provisions in Dodd-Frank, the U.S. Securities and Exchange Commission (SEC) has brought an increasing number of enforcement actions, including complex matters with...more